A Short Sale May Not Mean You're Home Free

A Short Sale May Not Mean You're Home Free
The Wall Street Journal

Financially troubled borrowers may think that foreclosure or a short sale of their home means their mortgage woes are over.
Not necessarily.

Banks urge Senate to reject mortgage relief bill
The Washington Post

WASHINGTON — A dozen financial groups, including the U.S. Chamber of Commerce and American Bankers Association, on Wednesday urged every member of the U.S. Senate to reject a key piece of President Barack Obama's plan to keep tens of thousands of Americans from losing their homes.

The letter to senators was the latest push by an industry that has helped stall the proposal, which would have let debt-ridden homeowners reduce their payments in bankruptcy court. The Senate was expected to defeat the measure on Thursday.

Eli Broad Says Rates Below 4% Needed to Move Foreclosure Glut
Bloomberg

Eli Broad, the billionaire founder of homebuilder KB Home, said “additional inducements,” including mortgage rates below 4 percent, are needed to sell a glut of foreclosed properties in parts of the U.S.

“I think we need an extra effort in those places to get rid of the unsold inventory and stabilize the housing market,” Broad said in an interview at the Milken Institute Global Conference in Beverly Hills, California.

First-time buyers find deals, help perk up house sales
USA Today

Kelly Butler just got a bargain.

Sure, her new three-bedroom home came with fake barn wood nailed to the bathroom walls, carpet that had to be ripped up, broken closet doors and a need for plumbing and tile work.

Lost equity puts boomers' future in doubt
Inman News

Baby boomers -- the largest, healthiest and wealthiest group ever appearing on the U. S. growth landscape -- never met a loan they didn't like. After leveraging appreciation and location in their starter and move-up homes to pay for cars, college tuitions and trips, their home probably holds most of the equity in their lives.

According to a new report by Washington, D.C.-based Center for Economic and Policy Research (CEPR), that home is not worth what it used to be. Coupled with the recent turmoil in the stock market, many boomers will be completely reliant on Social Security and Medicare to support them in their retirement years.

Fed Signals Its Intention to Stay the Course
The Wall Street Journal

The Federal Reserve signaled it has no intention of pulling back from its aggressive efforts to revive the financial system, even though it acknowledged that the intensity of the recession has eased in recent weeks.

The Fed said in a statement after its regular policy meeting that it would push forward with plans to substantially increase its holdings of mortgage-backed securities and Treasury securities in the months ahead, and suggested it could increase those purchases if markets and the economy veer further off track.

FHFA Proposes Rule to Adjust Housing Goals, Provide Credit for Loan Modifications
RISMedia

The Federal Housing Finance Agency (FHFA) sent a proposed rule establishing 2009 housing goals for Fannie Mae and Freddie Mac to the Federal Register for publication. Loan modifications undertaken by the GSEs consistent with the Administration’s loan modification initiative would receive credit toward achievement of housing goals.

“FHFA has determined that in light of current market conditions, the 2009 housing goal and home purchase subgoal levels previously established in regulation are not feasible unless they are adjusted,” said FHFA Director James B. Lockhart. “Restrictions on the availability of private mortgage insurance for borrowers with lower down payments, a surge in refinancing, particularly by higher income borrowers, the increasingly important role of FHA in the mortgage marketplace and a slowdown in the multifamily market, among other factors, mean fewer goals-qualifying loans in 2009.”

FBI Looks Into Losses at Freddie
The Wall Street Journal

Federal investigators looking into possible accounting violations at Freddie Mac are raising questions about whether the giant government-backed mortgage company improperly delayed the recognition of billions of dollars of losses, according to people familiar with the matter.

A confidential February 2008 report by the investigative firm Kroll concluded that "inappropriate application" of accounting rules "enabled Freddie to defer billions of dollars of losses incurred from 2001 through 2004" on derivative contracts whose value depends on fluctuations in interest rates, according to people involved in the matter. Those losses, currently pegged at about $3.7 billion, are due to be gradually recognized in quarterly earnings statements over the next several years.